Australian Super boss Ian Silk said factors like the royal commission, volatile markets and ongoing legislative tinkering combine to create a “challenging environment” into the future for superannuation.
In a recent address, he predicted the self-managed super fund sector would take a hit, driven by performance concerns and regulatory tightening.
He added: “There should not be any consistently underperforming funds – this is the most important change that will benefit members. You shouldn’t be able to be in a consistently poor fund – because they simply shouldn’t exist. If those running consistently underperforming funds don’t do the right thing, APRA must.”
Mr Silk also called on the industry to remedy the “unacceptable” situation that women currently retire with less superannuation than men.
“Many other groups don’t get their fair share of benefits from that system. The system is meant to be universal and needs to distributes those benefits more fairly,” he said.
For Mr Silk, any fund or offering that is not wholly member-centric will struggle in the long term.
“That future will be harder to deliver than the past – more competitive and with even greater scrutiny of our performance. We should welcome the extra scrutiny that comes with our current position of industry leadership,” he said.
“Each of us and our funds should make a genuine commitment to take our funds from their current position to elite performance for members,” he said.
“It’s easy to rely on formulaic words and say we’re committed to members’ best interests, and say that we’ll make that commitment,” he said.
“The real test will be whether we act in members’ interests every single time, not some or most of the time, but each and every time we make a decision, including when that might not be in the best interests of our fund, or even ourselves,” he said.